Virgin Media O2 and Vodafone UK have agreed to extend and enhance their existing mobile network sharing agreement for more than a decade, bolstering quality mobile coverage across the country and delivering improved services for customers.

This strategic partnership marks a significant milestone in the UK’s telecommunications landscape that will transform the experience for tens of millions of customers across the UK.

The extended agreement expands on an existing arrangement between Vodafone UK and Virgin Media O2, and is independent of the Vodafone UK and Three UK merger outcome (also called MergeCo). However, subject to completion of the merger, both operators have agreed that Virgin Media O2 will acquire spectrum from the newly created MergeCo, establishing three scaled mobile network operators each with better alignment of spectrum holding.

Lutz Schüler, CEO of Virgin Media O2 said: “This new agreement with Vodafone ensures that quality mobile network choice, performance, coverage, and competition is enhanced to the benefit of millions of consumers, businesses, and our mobile operator partners across the country. We are extending and bolstering elements of our existing network sharing arrangement, while also ensuring there is a robust, balanced, and functional structure in place for the long-term should Vodafone and Three’s proposed merger gain consent.”

Ahmed Essam, CEO, European Markets, Vodafone said: “With this agreement and our merger with Three, we will transform the mobile experience for over 50 million customers in the UK for the long-term, providing significant network improvements including more choice, better quality, and greater coverage across the country.  These benefits extend to both retail and wholesale MVNO (mobile virtual network operator) customers. The proposed merger, together with this agreement, will boost competition by establishing a strong third player in the UK mobile market and will improve the balance of spectrum holdings, levelling the playing field between the UK’s mobile operators.”

The agreement includes plans for Virgin Media O2 to purchase spectrum at market value from MergeCo, increasing their current holding.

Through a combination of MergeCo’s commitment to invest £11 billion in its network over the next decade – subject to Competition Markets Authority approval – and Virgin Media O2’s £2 billion annual investment in its networks and services, the VMO2 Vodafone agreement will ensure quality mobile connectivity, choice and competition is enhanced.

It also reduces the current imbalances in spectrum holding between the UK’s mobile network operators. This will not only benefit the companies’ respective customers but also businesses, which includes MVNOs who make use of networks via wholesale partnerships to deliver their own mobile services to millions of people across the country.

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